Good evening Ladies and Gentlemen:
Here are the following closes for gold and silver today:
Gold: $1173.20 up $5.40 (comex closing time)
Silver $15.95 down 3 cents (comex closing time)
In the access market 5:15 pm
Gold $1173.80
Silver: $16.00
Gold/Silver trading: see kitco charts on the right side of the commentary
Following is a brief outline on gold and silver comex figures for today:
At the gold comex today, we had a poor delivery day, registering 1 notice serviced for 100 oz. Silver comex filed with 6 notices for 30,000 oz.
Several months ago the comex had 303 tonnes of total gold. Today, the total inventory rests at 245.25 tonnes for a loss of 57 tonnes over that period.
In silver, the open interest rose by 1328 contracts despite the fact that Friday’s silver price was down by 12 cents. The total silver OI continues to remain extremely high with today’s reading at 184,005 contracts now at multi-year highs despite a record low price. This dichotomy has been happening now for quite a while and defies logic. There is no doubt that the silver situation is scaring our bankers to no end.
In silver we had 6 notices served upon for 30,000 oz.
In gold, the total comex gold OI rests tonight at 408,405 for a gain of 2,294 contracts despite the fact that gold was down $7.10 on Friday. We had 1 notice filed for 100 oz.
Late last night, we had a big withdrawal in gold inventory at the GLD to the tune of 1.19 tonnes. Thus the inventory rests tonight at 708.70 tonnes. The appetite for gold coming from China is depleting not only gold from the LBMA and GLD but also the comex is bleeding gold.
In silver, /we had a huge addition of 1.433 million oz in silver inventory at the SLV/Inventory rests at 319.608 million oz
We have a few important stories to bring to your attention today…
1. Today, we had the open interest in silver rise by 1328 contracts despite the fact that silver was down in price by 12 cents on Friday. The OI for gold rose by 2294 contracts up to 408,405 contracts despite the fact that the price of gold was down by $7.10 on Friday.
(report Harvey)
2, Lawrence Williams/Mineweb talks about gold demand from China (at 37.1 tonnes this week) and gold demand coming from India
(Lawrence Williams Mineweb)
3. Today, 4 important commentaries on Greece
zero hedge, Bloomberg)
4. War of words heats up the situation between the rebels and Ukraine
(zero hedge)
5, Another nail in the coffin of the USA dollar as Russia’s Sberbank issues guarantees in yuan.
(zero hedge)
6. Turkish lira plummets as Erdogan loses his majority
(zero hedge)
7. The two co CEO’s of Deutsche bank were canned..derivative problems???
(goldcore/zero hedge)
8 Bill Holter’s topic for today:
“The Biggest Black Swan of them all …False Beliefs!”
9. Precious metals trading overnight from Asia/Europe
(Goldcore)
10. Trading from Asia and Europe overnight
(zero hedge)
11. Trading of equities/ New York
(zero hedge)
12. Dave Kranzler continues his on two Texas institutions trying to get its physical gold out of the vaults at the HSBC bank at the FRBNY.
(Dave Kranzler IRD)
13. The plight of Kansas and McDonalds
(zero hedge)
we have these plus other stories to bring your way tonight. But first……..
let us now head over to the comex and assess trading over there today.
Here are today’s comex results:
The total gold comex open interest rose by 2294 contracts from 406,111 up to 408,405 despite the fact that gold was down $7.10 on Friday (at the comex close). We are now in the big active delivery contract month of June. Here the OI fell by 166 contracts down to 1097. We had 0 notices served upon on Friday. Thus we lost 166 contracts or an additional 16,600 oz will not stand for delivery. No doubt, again, we had a huge number of cash settlements and the farce continues. The next contract month is July and here the OI rose by 56 contracts up to 632. The next big delivery month after June will be August and here the OI rose by 1,424 contracts to 270,055. No doubt that the cash settled June contracts, having been bought out for fiat, rolled into August. The estimated volume today (which is just comex sales during regular business hours of 8:20 until 1:30 pm est) was poor at 73,586. The confirmed volume on Friday (which includes the volume during regular business hours + access market sales the previous day) was poor at 163,316 contracts. Today we had 1 notice filed for 100 oz.
And now for the wild silver comex results. Silver OI rose by 1328 contracts from 182,677 up to 184,005 despite the fact that the price of silver was down in price by 12 cents, with respect to Friday’s trading. The front non active delivery month of June saw it’s OI rise by 1 contract rising to 41. We had 9 contracts delivered upon on Friday. Thus we gained 10 silver contracts standing or an additional 50,000 ounces of silver will stand in this non active June contract month. The estimated volume today was poor at 17,950 contracts (just comex sales during regular business hours. The confirmed volume on Friday (regular plus access market) came in at 73,065 contracts which is very good in volume. We had 6 notice filed for 30,000 oz today.
June initial standing
June 8.2015
Gold
Ounces
Withdrawals from Dealers Inventory in oz
nil
Withdrawals from Customer Inventory in oz
100.000 oz (Brinks) ????
Deposits to the Dealer Inventory in oz
nil
Deposits to the Customer Inventory, in oz
192.90 oz (Brinks)6 kilobars
No of oz served (contracts) today
1 contract (100 oz)
No of oz to be served (notices)
1097 contracts (109,700 oz)
Total monthly oz gold served (contracts) so far this month
2599 contracts(259,900 oz)
Total accumulative withdrawals of gold from the Dealers inventory this month
nil
Total accumulative withdrawal of gold from the Customer inventory this month
81,065.2 oz
Today, we had 1 dealer transaction
i) Out of Brinks: a withdrawal of 100.000 oz??? exact
total Dealer withdrawals: 100.000 oz
we had 0 dealer deposit
total dealer deposit: nil oz
we had 1 customer withdrawals
i) Out of Brinks 192.90 oz (6 kilobars)
total customer withdrawal: 192.90 oz
We had 0 customer deposits:
Total customer deposit: nil oz
We had 0 adjustments:
Today, 0 notices was issued from JPMorgan dealer account and 10 notices were issued from their client or customer account. The total of all issuance by all participants equates to 1 contracts of which 0 notices were stopped (received) by JPMorgan dealer and 0 notices were stopped (received) by JPMorgan customer account
To calculate the total number of gold ounces standing for the May contract month, we take the total number of notices filed so far for the month (2599) x 100 oz or 259,900 oz , to which we add the difference between the open interest for the front month of June ( 1097) and the number of notices served upon today (1) x 100 oz equals the number of ounces standing.
Thus the initial standings for gold for the June contract month:
No of notices served so far (2599) x 100 oz or ounces + {OI for the front month (1097) – the number of notices served upon today (1) x 100 oz which equals 369,500 oz standing so far in this month of June (11.493 tonnes of gold). Thus we have 11.493 tonnes of gold standing and only 17.07 tonnes of registered or for sale gold is available:
Total dealer inventory 548,748.592 or 17.06 tonnes
Total gold inventory (dealer and customer) = 7,884,908.758 (245.25 tonnes)
Several months ago the comex had 303 tonnes of total gold. Today the total inventory rests at 245.25 tonnes for a loss of 57 tonnes over that period.
end
And now for silver
June silver initial standings
June 8 2015:
Silver
Ounces
Withdrawals from Dealers Inventory
nil
Withdrawals from Customer Inventory
777,491.910 oz (CNT,Brinks)
Deposits to the Dealer Inventory
nil
Deposits to the Customer Inventory
1,013,127.78 oz (CNT,JPM,Scotia)
No of oz served (contracts)
6 contracts (30,000 oz)
No of oz to be served (notices)
35 contracts(175,000 oz)
Total monthly oz silver served (contracts)
214 contracts (1,070,000 oz)
Total accumulative withdrawal of silver from the Dealers inventory this month
526,732.4 oz
Total accumulative withdrawal of silver from the Customer inventory this month
2,446,709.9 oz
Today, we had 0 deposits into the dealer account:
total dealer deposit: nil oz
we had 0 dealer withdrawals:
total dealer withdrawal: nil oz
We had 3 customer deposit:
i) Into CNT: 19,611.800 oz
ii) Into JPMorgan: 604,241.510 oz
iii Into Scotia: 389,274.47 oz
total customer deposit: 1,013,127.78 oz
We had 2 customer withdrawal:
i) Out of Brinks: 130,764.210 oz
ii) Out of CNT: 646,727.700 oz
total withdrawals from customer; 777,491.910 oz
we had 1 adjustment
i) Out of the CNT vault: 29,844.000 oz ??? was adjusted out of the customer and this landed into the dealer account of CNT
Total dealer inventory: 57.845 million oz
Total of all silver inventory (dealer and customer) 178.874 million oz
The total number of notices filed today is represented by 6 contracts for 30,000 oz. To calculate the number of silver ounces that will stand for delivery in June, we take the total number of notices filed for the month so far at (214) x 5,000 oz = 1,070,000 oz to which we add the difference between the open interest for the front month of June (41) and the number of notices served upon today (6) x 5000 oz equals the number of ounces standing.
Thus the initial standings for silver for the June contract month:
214 (notices served so far) + { OI for front month of June (41) -number of notices served upon today (6} x 5000 oz ,= 10,875,000 oz of silver standing for the June contract month.
we gained 50,000 ounces of silver that will stand for delivery in this month of June.
for those wishing to see the rest of data today see:
http://www.harveyorgan.wordpress.com orhttp://www.harveyorganblog.com
end
The two ETF’s that I follow are the GLD and SLV. You must be very careful in trading these vehicles as these funds do not have any beneficial gold or silver behind them. They probably have only paper claims and when the dust settles, on a collapse, there will be countless class action lawsuits trying to recover your lost investment.
There is now evidence that the GLD and SLV are paper settling on the comex.
***I do not think that the GLD will head to zero as we still have some GLD shareholders who think that gold is the right vehicle to be in even though they do not understand the difference between paper gold and physical gold. I can visualize demand coming to the buyers side:
i) demand from paper gold shareholders
ii) demand from the bankers who then redeem for gold to send this gold onto China
vs no sellers of GLD paper.
And now the Gold inventory at the GLD:
June 8/ a big withdrawal of 1.19 tonnes of gold from the GLD/Inventory rests at 708.70 tonnes
June 5/no change in gold inventory at the GLD/Inventory rests at 709.89 tonnes
June 4/ no change in gold inventory at the GLD/Inventory rests at 709.89 tonnes
June 3/late last night: a huge withdrawal of 4.18 tonnes. Tonight’s inventory rests at 709.89
June 2/no change in gold inventory at the GLD/Inventory rests at 714.07 tonnes
June 1/ we had a huge withdrawal of 1.79 tonnes of gold from the GLD/Inventory rests tonight at 714.07 tonnes
May 29/ no changes in gold inventory at the GLD/Inventory rests at 715.86 tonnes
May 28/ no changes in gold inventory at the GLD/Inventory rests at 715.86 tonnes
may 27: no changes in gold inventory at the GLD/Inventory rests at 715.86 tonnes
may 26.2015/we had a slight addition of .600 tonnes of gold to the GLD inventory/inventory rests at 715.86 tonnes
May 22.2015: no changes in gold inventory at the GLD/Inventory rests at 715.26 tonnes
June 8 GLD : 708.70 tonnes.
end
And now for silver (SLV)
June 8/no change in inventory/SLV inventory rests at 319.608 milion oz.
June 5 a huge addition of 1.433 million oz of silver added to the SLV/Inventory at 319.608 million oz
June 4/no change in silver inventory/rests tonight at 318.175 million oz
June 3/ we had a small withdrawal of 138,000 oz of silver inventory/Inventory rests at 318.175 million oz
June 2/ we had a huge addition of 1.243 million oz of silver inventory at the SLV./Inventory rests at 318.313 million oz
June 1/no change in inventory at the SLV/Inventory rests at 317.07 million oz
May 29/no changes in inventory at the SLV/Inventory rests at 317.07 million oz
May 28/a small deposit of 143,000 oz of silver added to the SLV/Inventory rests at 317.070 million oz
May 27/we had another 1.003 million oz withdrawn from the SLV/Inventory rests tonight at 316.927 million oz
June 8/2015:no change in silver inventory at the SLV /SLV inventory at 319.608 million oz/
end
And now for our premiums to NAV for the funds I follow:
Sprott and Central Fund of Canada.
(both of these funds have 100% physical metal behind them and unencumbered and I can vouch for that)
1. Central Fund of Canada: traded at Negative 7.5% percent to NAV in usa funds and Negative 7.7% to NAV for Cdn funds!!!!!!!
Percentage of fund in gold 61.4%
Percentage of fund in silver:38.2%
cash .4%
( June 8/2015)
2. Sprott silver fund (PSLV): Premium to NAV falls to +.48%!!!!! NAV (June 8/2015)
3. Sprott gold fund (PHYS): premium to NAV rises to – .12% to NAV(June 8/2015
Note: Sprott silver trust back into positive territory at +.48%.
Sprott physical gold trust is back into negative territory at -.12%
Central fund of Canada’s is still in jail.
Last week Sprott formally launches its offer for Central Trust gold and Silver Bullion trust:
SII.CN Sprott formally launches previously announced offers to Central GoldTrust (GTU.UT.CN) and Silver Bullion Trust (SBT.UT.CN) unitholders (C$2.64)
Sprott Asset Management has formally commenced its offers to acquire all of the outstanding units of Central GoldTrust and Silver Bullion Trust, respectively, on a NAV to NAV exchange basis.
Note company announced its intent to make the offer on 23-Apr-15 Based on the NAV per unit of Sprott Physical Gold Trust $9.98 and Central GoldTrust $44.36 on 22-May, a unitholder would receive 4.45 Sprott Physical Gold Trust units for each Central GoldTrust unit tendered in the Offer.
Based on the NAV per unit of Sprott Physical Silver Trust $6.66 and Silver Bullion Trust $10.00 on 22-May, a unitholder would receive 1.50 Sprott Physical Silver Trust units for each Silver Bullion Trust unit tendered in the Offer.
* * * * *
end
Early morning trading from Asia and Europe last night:
Gold and silver trading from Europe overnight/and important physical
stories
(courtesy Mark O’Byrne/Goldcore)
Deutsche Bank CEOs “Shown Door” – World’s Largest Holder of Derivatives In Trouble?
(also see zero hedge below on this big story!!)
By Mark O’ByrneJune 8, 2015No Comments
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– Deutsche co-CEO’s announce “resignation” nine months before their contracts expire
– Only two weeks ago, CEO Anshu Jain was given more power to reorganise the bank
– Deutsche have been engaged in money laundering, tax evasion, derivative and manipulation scandals
– Deutsche is world’s largest holder of financial weapons of mass destruction (FWMD)
– Deutsche Bank’s derivatives position almost 15 times as large as Germany’s GDP
– Announcement follows Greek failure to pay IMF on Friday and growing financial risk
The joint CEO’s of Germany’s largest bank, Deutsche Bank, the twelfth largest bank globally in terms of assets, unexpectedly announced their resignation over the weekend. Anshu Jain will resign at the end of this month, almost two years ahead of schedule while Juergan Fitschen will stay on until May of next year.
It is believed they resigned but some media reported that the CEOs heads had “rolled”, they were “shown the door” and Reuters reporting that Deutsche had “purged its leadership.”
The announcement followed what Deutsche Bank described as “an extraordinary meeting” over the weekend. It is particularly surprising given that Jain had been granted extra powers at the bank only two weeks ago to reorganise the scandal plagued lender.
In the past year Deutsche, like many international banks, have been found to have been engaged in a slew of corrupt practices from manipulation of interest rates, for which the firm was fined $2.5 billion in April, to tax evasion and money laundering to “mis-selling” of derivatives.
Deutsche Bank’s derivatives position is truly enormous. It was recently estimated to be around $54 trillion. Germany’s GDP, the fourth largest in the world, was a mere $3.64 trillion in 2015. Were Deutsche Bank caught off-side in its derivatives positions there is not a government or institution on earth that could bail it out and it could lead to contagion in the German financial system and indeed in the global financial system.
The contagion from such an event would be devastating. It is for this reason that Warren Buffet described derivatives as WMD or “financial weapons of mass destruction.”
It is unnerving that the shock resignation should follow an “extraordinary meeting” over the weekend following the failure of Greece to meet its scheduled payment to the IMF on Friday.
This does not count as a Greek default but it increases the risk of a default on the amalgamated 1.5 billion euros that now must be paid by the end of June. A default and the triggering of credit default losses would cause massive volatility in financial markets and potentially destabilise an already shaky global bond market and global financial system.
There have been a number of shocks to the market this year which would have been expected to have led to sharp losses in the derivatives market but slipped quietly by.
The debris caused by the massive volatility in the Swiss Franc following its being unpegged from the Euro – where it spiked 30% in minutes in January – seems to have been swept under the carpet. Austria’s bad bank Heta failed in late February with apparently no casualties.
We do not know what provoked the dramatic reversal in attitude to Anshu Jain at Deutsche Bank but it looks very much like the bank may be getting its house in order in anticipation of another major scandal or crisis. When said crisis breaks the responsibility can be dumped on the previous leadership.
Since Warren Buffett’s initial warning in 2002 , 13 years ago, he has been remarkably quiet on the real and growing threat to global markets and the global financial system. Despite the fact that the scale of the risk today is of an order of magnitude greater now than it was then.
This is unfortunate given the global financial system itself is far more volatile and casino like today than it was in 2002.
Sucking on the teet of Wall Street can lead to self induced omerta.
The global derivatives market is highly complex, totally unregulated and frighteningly large. One of the world’s leading derivatives experts, Paul Wilmott, who holds a doctorate in applied mathematics from Oxford University, has warned that the so-called notional value of the worldwide derivatives market is over $1.4 quadrillion.
A quadrillion is an incomprehensibly massive figure: it is 1,000 times a trillion or 1 with 12 zeros. A trillion is 1,000,000,000,000 and a quadrillion has 15 zeros – 1,000,000,000,000,000. The annual gross domestic product of the entire planet is between $50 trillion and $60 trillion. Thus, the derivatives markets notional value is more than 23 times the size of the value of all of the goods and services traded in global economy in one full year.
The crisis in Greece, the rumblings in the global bond market and indeed in Europe’s fourth largest bank and the threat posed by financial weapons of mass destruction should give cause for concern. It is another reason to reduce allocations to stock and bond markets and increase allocations to gold.
The real systemic risk of today is another reason to ensure owning allocated and segregated gold in the safest vaults in the safest jurisdictions in the world.
Must Read Guide: 7 Key Gold Must Haves
MARKET UPDATE
Today’s AM LBMA Gold Price was USD 1,173.40, EUR 1,053.32 and GBP 769.85 per ounce.
Friday’s AM LBMA Gold Price was USD 1,175.90, EUR 1,044.25 and GBP 767.82 per ounce.
Gold and silver were both down last week – down 1.58 percent and 3.77 percent respectively.
Gold fell $6.10 or 0.52 percent Friday to $1,170.90 an ounce. Silver slipped $0.08 or 0.49 percent to $16.10 an ounce.
Gold in Singapore for immediate delivery ticked lower and then higher and was up 0.1 percent to $1,172.86 an ounce an ounce near the end of the day, while gold in Switzerland was again flat. A stronger dollar, near a 13 year high verses the yen, may have contributed to gold’s recent weakness.
After Friday’s U.S. nonfarm payrolls report showed its largest growth since December, up 280,000 from last month, gold sunk to an eleven week low at $1,162.35 an ounce. The payrolls figure was significantly higher than the 225,000 that analysts were expecting. Although some question the veracity of the Bureau of Labor Statistics jobs numbers.
The jobs number led to renewed idle speculation that the U.S. Fed may start to raise interest rates in September.
A senior U.S. official today denied a news wire report that President Barack Obama had told a Group of Seven industrial nations’ summit that the strong dollar was a problem.
Bloomberg News earlier quoted a French official as saying Obama had made the comment. “The President did not state that the strong dollar was a problem,” the U.S. official said. He made a point that he has made previously, a number of times: that global demand is too weak and that G7 countries need to use all policy instruments, including fiscal policy as well as structural reforms and monetary policy, to promote growth.”
Sentiment in the euro zone weakened further in June as the Greek debt crisis and a slightly firmer single currency prompted investors to pare back their expectations for the economy. Sentix research group’s index tracking morale among investors and analysts in the euro area slipped to 17.1 in June from 19.6 in May. That was below the Reuters consensus forecast for a reading of 18.7.
The world’s largest gold back ETF, the SPDR Gold Trust, saw holdings drop 0.17 percent to 708.70 tonnes on Friday,its lowest since mid January. This shows poor sentiment in the gold market.
In South Africa, the Mineworkers and Construction Union said yesterday it would launch a strike if its rival union and gold mining companies impose a wage deal on its members.
In late European trading gold is up 0.31 percent at $1,174.81 an ounce. Silver is up 0.08 percent at $16.11 an ounce and platinum is up 0.41 percent at $16.11 an ounce.
Breaking News and Research Here
end
We now have our second mining company write a complaint to the CFTC on silver manipulation. The company: Gold Resource.
To Timothy Massad
Chairman, CFTC
May 28.2015:
The following has been brought to my attention:
The Commitments of Traders Report (COT) for May 19, 2015 indicates a record position change of more than 28,200 net contracts of COMEX silver futures being purchased by traders in the managed money category, the equivalent of 141 million ounces of silver and 61 days of world mine production. The COT report also indicates nearly 24,400 net contracts were sold by traders classified as commercials and the equivalent of 122 million ounces and 53 days of world mine production.
In addition, the report indicated that 8 traders in COMEX silver futures held a net short position of 376 million equivalent ounces of silver, by far the most of any commodity in terms of world production (163 days). With silver prices at current low levels, it is puzzling why the concentrated short position would be so large.
Since the Commission classifies traders in the managed money category as speculators (as opposed to hedgers) and because there is little evidence from public financial reports that silver producers are represented in the commercial category, it appears the big changes in positions on the COMEX are by speculators and commercials acting as speculators and not by those engaged in bona fide hedging.
It occurs to me that such massive speculation in COMEX silver futures may not be in keeping with the spirit and intent of commodity law and may suggest something is wrong with the price discovery process, since real producers and consumers of silver don’t appear to be represented.
Please address these issues in light of the current depressed price of silver and the questionable futures contracts.
I look forward to hearing from you.
Sincerely,
Jason Reid
CEO / President
end
A very important read…
(courtesy Dave Kranzler/IRD)
State Of Texas To The Fed/Government: “We Want Our Gold”
June 8, 2015Financial Markets, Gold, Market Manipulationanti-gold terrorism,Comex, GLD, gold leasing, LBMA
This Texas Gold Depository Bill represents a direct threat to the western Central Bank fraudulent fractional gold reserve system in which most if not all of the bullion held by the Fed, ECB banks and the Bank of England has been leased or hypothecated. This Bill, if passed, represents a direct threat to the wealthy elitists’ ability to loot our system using the U.S. dollar Ponzi scheme. – Investment Research Dynamics
Two big public pension funds in Texas – University of Texas and the Texas Teachers Retirement System – own more than $1 billion worth of gold. It was originally being held in the form of futures and ETFs. In 2011, uncomfortable with owning gold in paper form, University of Texas took delivery of bars and “safekept” them in an HSBC vault in NYC.
Now there’s Bill sitting on the Texas Governor’s desk waiting to be reviewed for his signature. Clearly, there are powerful entities in Texas who are concerned about the possibility that the gold owned in physical form by the State of Texas is at risk if it remains in storage in a bullion bank vault in NYC.
I think that somebody was looking at that, we better have this under our complete control,” said constitutional lawyer and gold expert Edwin Vieira, of the Texas bill. “They don’t want to have the gold in some bank somewhere and in two to five years it turns out not to be there.” – Edwin Vieira, Constitutional law expert specifically as the Constitution relates to money
While the State of Texas is going to attempt to pre-empt the risk that the physical gold owned by Texas has been or will be hyothecated or leased, I would bet that the bars already have counterparty ownership claims attached, even if the bars are still sitting in HSBC’s vault.
It’s no secret anymore that the western Central Banks have leased out most of the gold being stored in their vault facilities. Anyone who denies this is either completely corrupted or a complete idiot. Even Alan Greenspan admitted to Congress that the Fed leases gold to control the price:
Nor can private counterparties restrict supplies of gold, another commodity whose derivatives are often traded over-the-counter, where central banks stand ready to lease gold in increasing quantities should the price rise. –Alan Greenspan, July 24, 1998
Re-read that statement and think about what Greenspan is saying. He’s implicitly stating that the Fed can create enough paper gold – i.e. gold in lease form – in order to contain the price of gold. Please note: gold can be leased without actually moving the physical bars if the counterpart to the lease does not demand delivery. However, the ownership of that bar for legal purposes has transferred to the counterparty to whom the bar was leased.
Thus, in theory, a Central Bank can create a limitless supply of paper gold if it is not required to deliver any bars. This is the same idea behind Bernanke’s famous “helicopter speech” in which he stated that electronic currency can be created in infinite supply.
HSBC has likely already leased out or hypothecated most if not all of Texas’ gold bars sitting in its vault. While HSBC would be on the hook for the gold bars owed to Texas, Texas would be at risk for the possibility that HSBC would be unable to procure and deliver even a single gold bar. This scenario would arise if HSBC were to go bankrupt, a risk of which is clearly outlined in the GLD prospectus (HSBC is the custodian for GLD).
“This exact scenario happened with futures broker MF Global. I knew people who had warehouse receipts to gold bars with a specific serial number. But that gold had an encumbered title and they became unsecured creditors in bankruptcy,” said Weiner. – Keith Weiner, President of the Gold Standard Institute LINK
Apparently the wiser people in Texas were watching closely when Germany asked the Fed to ship over 600 tonnes of gold bars that had been “safekept” in NYC since the end of WW II. In so many words the Fed/US Government said: “we’ll send you your gold when we’re good and ready to send it.”
The message is that the gold was not there to be shipped. Obviously Germany was not going create a massive political problem for itself by attempting to force the U.S. legally to produce and ship the bars. Instead the German political leaders simply winked at the U.S. and said “okay, we understand the problem -take your time.”
Even more interesting perhaps, is a provision in the Texas Bill which prevents the Federal Government from seizing the gold bars:
Section A2116.023 of the bill states: “A purported confiscation, requisition, seizure, or other attempt to control the ownership … is void ab initio and of no force or effect.” Effectively, the state of Texas will protect any gold stored in the depository from the federal government. LINK
It will be interesting to watch this situation unfold, especially if Governor, Gregg Abbott signs the Bill. You can read the article from which I sourced the above quotes here: Texas Has The Potential To Uproot The Monetary System
I hope I’m wrong about this, but if I put my “think like a criminal” thinking cap on, I can envision a scenario in which the powerful political and money interests in Washington, DC and NYC exert a full assault on Governor Abbott to veto the Bill. This is the kind of legislation that could potentially expose the fraudulent fractional gold reserve system in the U.S. in which the ratio of paper claims to gold is several multiples. In fact, it’s the type of legal movement that could burn down the U.S. dollar.
end
Lawrence Williams/Mineweb
demand of gold from China in this latest week: 37.1 tonnes
(courtesy Lawrencwe Williams/Mineweb)
China’s SGE gold withdrawals on track for record
Beware headlines suggesting massive fall-offs in Chinese and Indian gold demand. Further analysis shows these are just normal seasonal variations.
Lawrence Williams | 8 June 2015 12:25
LONDON – With gold withdrawals from the Shanghai Gold Exchange (SGE) totalling a further 37.1 tonnes for the week ended May 29, the total for the first five months of the year has been an absolutely massive 983 tonnes – the highest total on record for the period. Withdrawals have admittedly fallen back from the high Chinese New Year figures, but they are still running strongly for the time of year. One has to assume that the half year figure will be in the region of 1,150-1,200 tonnes, which will be a record for the period.
Indian gold imports for March – the most recent month for which official figures have just become available – have also been high – at 131.5 tonnes, although admittedly this was at the tail end of the festival season and imports will likely now drop back quite sharply as is usual through the Q2/Q3 period as the monsoon season kicks in and the rural gold buyers tend to hold fire until they have a better idea of how good the rainy season, and the likely crop yield, will be. But with the high 10% import duties on gold one suspects the true figure is rather higher due to gold smuggling. True, April imports are estimated to have fallen back to 81 tonnes, but seasonal factors are kicking in and the pre-monsoon forecasts are not encouraging.
But, reading some media headlines one would be led to assume that Chinese and Indian demand has dwindled dramatically they have been so negative of late. We have touched on this before – in particular with regard to the treatment of Hong Kong net gold exports to China, which are no longer nearly as relevant since China eased the path for gold imports to come in directly to the mainland from other nations than Hong Kong. Figures from Switzerland – the biggest known direct exporter of gold bullion to China – show it now sends 30-40% of its gold direct to the mainland, thus bypassing Hong Kong altogether. The US likewise on the latest US Geological Survey figures we have seen. And now, with Chinese companies buying controlling stakes in overseas gold miners, there is yet another potential pathway for gold to come in directly.
We are also entering a time of year when gold demand does indeed drop in both China and India, with the big early year festivals over. This happens every year, so figures comparing say April gold movements into China or Hong Kong, with those from March, can be taken as misleading in terms of the emphasis which seems to be put on them, as they can for India.
As an example, take this Bloomberg Headline of May 28 and the ensuing article – ‘China’s H.K. Gold Imports Slide as Falling Prices Delay Buying’. It goes on to note that ‘Net inbound shipments dropped to 46.6 metric tons last month from 61.8 tons in March and 65.4 tons a year earlier’ but no mention anywhere of the seasonal demand factors, nor the fact that now China is taking far more gold directly into mainland ports than it was a year ago and avoiding going through Hong Kong altogether.
At least the recent article on Mineweb, initially published by Fastmarkets in London, headed Swiss gold exports to China drop 67% in April, although very negative in tone, did recognise the seasonal factors in play here. It also noted that although Swiss exports to mainland China fell to 15.1 tonnes (26% of combined China and Hong Kong imports) in April, those to Hong Kong (mostly destined for mainland China), actually rose to 43.4 tonnes, up 36%. Doing the maths this implies that Swiss exports to mainland China will have accounted for almost 59% of the Hong Kong and China combined total the previous month. So one suspects some of the differences in the figures for both months were likely strongly affected by the overall timing of deliveries. Over the two-month period China mainland imports will have come to 60.9 tonnes and Hong Kong’s to 77.7 tonnes, thus showing that almost 44% went into mainland China directly, completely bypassing Hong Kong. It also suggests that if one takes Hong Kong and China together the fall off in demand over the two months was from 77.7 tonnes in March to 58.5 tonnes in April – a fall of only around 25% as compared with the 67% suggested by the headline. True, a substantial fall but not unexpected for the time of year.
end
(courtesy Craig Hemke/TFMetals/GATA and Andrew Maguire/Kingworldnews)
TF scorns phony jobs report; Maguire sees cash settlement in metals
Submitted by cpowell on Fri, 2015-06-05 20:14. Section: Daily Dispatches
4:15p ET Friday, June 5, 2015
Dear Friend of GATA and Gold:
Today’s U.S. jobs report is mere guesswork and contrivance, the TF Metals Report’s Turd Ferguson writes, adding his chart analysis concluding that the monetary metals are oversold. His commentary is headlined “Birth-Deathing Your Way to Prosperity” and it’s posted at the TF Metals Report here:
http://www.tfmetalsreport.com/blog/6897/birth-death-ing-your-way-prosper…
And London metals trader Andrew Maguire tells King World News today that cash settlement is likely for traders holding unallocated gold in London. An excerpt from the interview is posted at the KWN blog here:
http://kingworldnews.com/andrew-maguire-warns-western-central-banks-and-…
CHRIS POWELL, Secretary/Treasurer
Gold Anti-Trust Action Committee Inc.
end
(Bloomberg/GATA)
Did Obama tell G-7 strong dollar is a problem?
Submitted by cpowell on Mon, 2015-06-08 11:54. Section: Daily Dispatches
Obama Said to Tell G-7 Leaders Strong Dollar Poses a Problem
By Helene Fouquet
Bloomberg News
Monday, June 8, 2015
President Barack Obama told fellow Group of Seven leaders that the strong dollar is a problem, according to a French official with knowledge of the talks.
Geopolitical risks including Greece create volatility on financial markets, affecting interest rates and currencies, the official told reporters at the G-7 summit in southern Germany on Monday. In that context, Obama said that the strong dollar posed a problem, according to the official, who asked not to be named because the discussions were private. …
… For the remainder of the report:
http://www.bloomberg.com/news/articles/2015-06-08/obama-said-to-tell-g-7…
* * *
White House Denies Obama Said Strong Dollar a Problem
By Jeff Mason and Noah Barkin
Reuters
Monday, June 8, 2015
A senior U.S. official denied today news wire report that President Barack Obama had told a Group of Seven industrial nations’ summit that the strong dollar was a problem.
Bloomberg News earlier quoted a French official as saying Obama had made the comment.
“The president did not state that the strong dollar was a problem,” the U.S. official said. …
… For the remainder of the report:
http://www.reuters.com/article/2015/06/08/us-g7-summit-obama-dollar-idUS…
end
(courtesy Reuters/GATA)
Hungary is first European country to sign up for China’s Silk Road plan
Submitted by cpowell on Sun, 2015-06-07 04:04. Section: Daily Dispatches
By Ben Blanchard and Paul Carsten
Reuters
Sunday, June 7, 2015
BEIJING — Hungary has become the first European country to sign a cooperation agreement for China’s new “Silk Road” initiative to develop trade and transport infrastructure across Asia and beyond, China’s foreign ministry said late Saturday.
The countries’ foreign ministers signed a memorandum of understanding for what is formally known as the “One Belt, One Road” project in Budapest, according to a statement on the Chinese foreign ministry website.
China welcomes more European countries to look east and strengthen cooperation with China and other Asian countries, and participate in the “One Belt, One Road” in various ways, said Wang Yi, China’s foreign minister, according to a separate statement on the website. …
… For the remainder of the report:
http://www.reuters.com/article/2015/06/07/china-hungary-idUSL3N0YT01U201…
end
We have been witnessing a huge increase in the bond yields throughout the globe. Bill Holter explains the significance:
(courtesy Bill Holter/Holter/Sinclair collaboration)
The Biggest Black Swan of them all …False Beliefs!
Global markets are changing drastically and showing volatilities like we saw back in late 2008. I am not talking about stock markets, it is the debt and currency markets that are schizophrenic. Oddly, even after all of the various Western “QE’s”, liquidity suddenly looks like it is drying up. A great article as to why even the depth in the U.S. Treasury market has disappeared can be read here http://www.zerohedge.com/news/2015-06-04/here-reason-there-no-bond-market-liquidity . Various credit markets (important one’s!) have cracked over the last month and the myth of “zero percent interest” rates is in the process of being shattered. I want to visit several topics in this piece, each one with the ability to break the derivatives chain which is exactly what we are headed for!
First and foremost, I believe we are about to find out central banks are not the omnipotent powers we’ve been led to believe. You might as well say central banks have been perceived as all powerful, all knowing and the savior of any and all things “bad”. The confidence in central bank’s abilities to fix anything and everything has grown to epic proportions and is now ingrained everywhere. This thought process is so prevalent, we might as well say it is “imprinted” in the mass psyche from birth!
What we are seeing now are credit markets revolting against the risk of over levered sovereign treasuries and the fact of receiving zero compensation for the outsized risk. Investors were led and cajoled by central banks into this corner of uncompensated risk. It was easy. Central banks led by the Fed only needed to announce their “plans” and investors stormed the credit markets in front running fashion.
A natural problem or two is arising. Interest rates have been zeroed out for too long. As the three Fed stooges finally admitted last week, zero interest rates are only justified by crisis. Continued zero interest can mean only one of two things, we are still in a crisis behind the scenes or rising interest rates cannot be tolerated by markets with no margin left. Both of these are the reality! Before going any further, one thing needs to be made clear. Central banks do not, better said CANNOT set interest rates. Yes, they can push, pull, “suggest” and even buy sectors of the credit market to affect interest rates…
…BUT ONLY in the short run. My point is this, “the short run” is ending! The central banks are running up against the “confidence clock” if you will. The economic and financial lies told are now being revealed for what they are, WHOPPERS! Think about it, do any numbers make sense? Inflation? GDP? Employment? Spending? Housing? Nothing reported now makes any sense at all and the lies have by necessity gotten so big, even little children know them not to be true.
The truly HUGE problems lay in the derivatives markets. These are multiples of all markets …with very thin margins allowed for losses. The volatility seen in currencies and debt over the last month have surely bankrupted many. You see, it was the use of derivatives markets in the first place to “engineer” the bubbles …which are now bursting! It is quite simple, the leverage afforded by derivatives, funded by credit and freely printed currency blew the bubbles to begin with. Margin calls and forced closure of many of these derivatives will be the driving force of the coming collapse. A broken derivatives chain will break everything beneath them including the currencies themselves.
The following is how Jim Sinclair has described derivatives:
“There is no such thing as a derivative that does not have an implied or defined interest rate characteristics. This is the chain that connects them all.
That makes this problems larger than one quadrillion dollars, the true level of the notional value derivatives outstanding before the BIS got into Whoopers, changed the computer program for measurement and reduced outstanding notional value of derivative outstanding to just $700 trillion in 2007. Here is the concept you must understand. Notional value of a derivative becomes real value of the derivative in the event of derivative bankruptcy. Derivative bankruptcy is defined as the breaking of the interlocking chain, interest rates. Now, you t